Tata Capital IPO: An Overview for Indian Investors
Tata Capital Ltd, the financial services arm of the Tata Group, is set to launch its initial public offering (IPO) on Oct. 6, 2025, with the issue closing on Oct. 8, 2025. The IPO is expected to be among the most closely watched offerings of the year, given Tata Capital’s position as a leading non-banking financial company (NBFC) in India.
The IPO will comprise a fresh issue of up to 21 crore equity shares and an offer for sale (OFS) of up to 26.6 crore equity shares. Promoter Tata Sons will divest up to 23 crore shares, while International Finance Corporation (IFC) will sell up to 3.6 crore shares through the OFS route. The company will also issue up to 21 crore shares via a primary raise.
Why Is the Tata Capital IPO Significant?
The public issue is significant not only because of the company’s stature as the financial services arm of the Tata Group but also due to its expected impact on the Indian stock market. The listing of Tata Capital will increase the number of Tata Group companies that are publicly traded to 17, further enhancing the group’s presence in the Indian capital market.
Currently, Tata Sons owns an 88.6% stake in the NBFC on a fully diluted basis, while other Tata group companies own another 7%. IFC currently holds 7.16 crore shares worth a 1.8% stake in the firm.
Use of IPO Proceeds
Tata Capital proposes to use the fresh issue proceeds for augmenting its tier–I capital base to meet its ‘future capital requirements, including onward lending,’ arising out of the growth of the business. Further, a portion of the proceeds from the fresh Issue will be used towards meeting offer expenses.
Book Running Lead Managers
Kotak Mahindra Capital Co., Axis Capital Ltd., BNP Paribas, Citigroup Global Markets India Pvt. and HDFC Bank Ltd. are the book running lead managers for the issue. This lineup of prominent financial institutions underscores the IPO’s significance and the confidence of the market in Tata Capital’s growth potential.
Financial Performance
In the quarter ended June, the NBFC posted a revenue of Rs 7,664.81 crore in comparison to Rs 6546.28 crore posted in the same quarter last year. The company’s profit for the quarter more than doubled at Rs 1,040.93 crore, against Rs 472.21 crore reported in the quarter ended June 2024.
For fiscal year 2025, the Tata’s financial services arm reported a profit of Rs 3,655 crore, an increase from Rs 3,327 crore in the previous fiscal, while its revenue surged to Rs 28,313 crore from Rs 18,175 crore. This robust financial performance indicates the company’s strong fundamentals and its ability to capitalize on growth opportunities in the financial services sector.
Investment Opportunity
The IPO of Tata Capital presents an investment opportunity for Indian investors looking to diversify their portfolios with a stable and growing NBFC. Given the company’s diversified financial services portfolio, strong parentage, and experienced management, it is poised for long-term growth.
However, as with any investment, it’s crucial for potential investors to carefully evaluate the company’s financials, industry outlook, and valuations before making an informed decision. The IPO investment process also involves understanding the risks associated with equity investments and aligning them with one’s risk tolerance and investment goals.
Conclusion
The Tata Capital IPO is a significant event in the Indian stock market, offering investors a chance to participate in the growth story of a leading financial services company. With its strong financial performance, diversified services portfolio, and the backing of the Tata Group, Tata Capital is well-positioned to capitalize on the opportunities in the Indian financial sector.
For investors looking to stay updated on the latest developments regarding the IPO, including its pricing, allotment, and listing, it’s essential to follow reliable stock market news sources and consult with financial advisors. The Indian stock market is ripe with opportunities, and making informed investment decisions requires staying abreast of market trends and company-specific news.